WOOD COATINGS MARKET ANALYSIS

Stringent environmental regulations implemented by various governments are posing challenges for the growth of the global wood coatings market. Many countries have passed laws aimed at reducing VOC (volatile organic compound) emissions from industrial and commercial activities to mitigate air and water pollution. Since wood coatings contain solvents that release VOCs during application and drying processes, their formulations need to comply with new emission standards. This is requiring coatings manufacturers to invest heavily in research and development of lower VOC and zero VOC coating technologies. Transitioning to greener coatings has proven to be a costly and time intensive shift. Formulating products that meet performance requirements while keeping VOC levels within prescribed limits is a complex task. Manufacturers have to evaluate numerous resin system and solvent options before arriving at viable solutions. Testing and certification processes for new products also prolong the development cycle. The additional R&D expenses involved in creating sustainable coatings are restricting investments toward capacity expansions by manufacturers. Some smaller players struggling with the regulatory compliance costs are forced to shut down operations impacting market competition.

Market Opportunities: Emerging economies in Asia Pacific and Middle East Africa

Emerging economies in the Asia Pacific and Middle East Africa regions provide immense opportunities for growth in the global wood coatings market. These regions are experiencing rapid infrastructural development and urbanization at an unprecedented pace. According to World Bank data, the urban population in East Asia & Pacific is expected to rise to 67% by 2030 from 53% in 2020. Countries like China, India and Indonesia are focusing on infrastructure, real estate and construction projects to meet the demands of growing urban populations and rising GDP. This would require massive amounts of wood and wood products for applications like furniture, flooring, cladding and beams.